Cola War Continue

Cola Wars Continue: Coke and Pepsi in 2006

Question: Identify the key marketing issues (Company weakness and the main opportunities and threats for company) met by Coke and Pepsi.

SWOT Cola Pepsi

Strengths • The flagship of soft drink global market share, approximately 40%

• High profit margin by shifting some cost to bottlers

• Strong marketing campaign

• Expanded manufacturing and distribution system that kept prices low, Coke located in more than 200 countries.

• The biggest market share of non-carb productions in US and the second best selling soft drink brand in the world.

• Aggressive marketing strategies using the target customer, Pepsi Generation.

• Offered the product innovation.

Weakness • Decreasing in CSD market.

• Having a complex relationship with North American bottlers.

• Reacting slowly with new market trends.

• Decreasing in CSD market.

• Lack of sensitivity in expanding the global system.

• Focusing only young people.

Opportunities • The soft drink demand in Pacific-Asia Countries increases over 40% steadily.

• Entry in the fast growing of energy-drink segment and new packages.

• Dominating in Western Europe and much of Latin American.

• Positioning in the Middle East and Southeast Asia.

• Growth in healthier beverages.

• Growth in Tea Asia and functional drink beverages.

• The younger generation structure of the global population.

Threats • The powerful competitor Pepsi and the growth of new local rivals.

• Obesity and other health-related.

• A contamination scare causing of the product process.

• Bad financial situation with decreasing in net income.

• Coke has become the icon and image of soft drink beverage for a long time in the world.

• Obesity and other health-related.

• Coke increases the marketing and innovation spending to $400 million.

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